px_eliezer_ There are a few products they see for less, but the bulk of stuff they sell is from China so it will be interesting to see how US based dollar store fair over the next few years.
It boils down to markup, if the can sell more stuff with a lower markup than other stores they are ahead; this is what they do and why they are successful over mega giants such as Walmart which have a wider selection of goods but sell for higher amounts. Dollar stores have low operational costs (pay workers min wage, take up cheap retail space in depressed areas) so they can’t cut back on that unless they can use some sort of robotic shelf restocking system. The downside with having a lot of these stores in an area is that if it becomes too economically depressed these stores are just heavily mined by thieves driving them under and closing.